HomeMy WebLinkAbout07 - NB Firefighters Association Supplemental MOUTO
FROM:
CITY OF NEWPORT BEACH
CITY COUNCIL STAFF REPORT
Agenda Item No. 7
April 13, 2010
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
Dave Kiff, City Manager
949 - 644 -3000, dkiffta)newportbeachca.gov
Terri L. Cassidy J.D., Human Resources Director
949 - 644 -3303, tcassidv(anewportbeachca.gov
SUBJECT: Approval of Resolution Adopting a Supplemental Memorandum of
Understanding between the City of Newport Beach and the Newport
Beach Firefighters Association extending the term to December 31,
2011; and Adoption of Resolution Implementing a CaIPERS Time -In-
Grade Exception
ISSUE:
Should the City Council adopt a resolution approving the terms of a Supplemental
Memorandum of Understanding between the City of Newport Beach and the Newport
Beach Firefighters Association extending the contract term from December 31, 2010 to
December 31, 2011; and should the City Council adopt a resolution approving a
California Public Employees' Retirement System (CaIPERS) Time -in -Grade Exception
for Employer Paid Member Contributions (EPMC), which is provided for in the MOU?
RECOMMENDATION:
The following actions are recommended:
1. Approve the resolution adopting the Supplemental Memorandum of
Understanding between the City of Newport Beach and the Newport Beach
Firefighters Association (Attachment A); and
2. Approve the resolution adopting the CaIPERS Employer Paid Member
Contribution Time -in -Grade Exception (Attachment B).
DISCUSSION:
Background:
On December 15, 2009, at the request of the City, the Newport Beach Firefighters
Association, through their negotiations team of Chad Ponegalek, President, Brian
NBFA Supplemental MOU
April 13, 2010
Page 2
McDonough, Vice - President, Jeff Boyles, Representative at Large and Rich Thomas,
Professional Labor Relations Representative began meeting with the City's negotiators
Terri Cassidy, Human Resources Director and Bill Avery, Professional Labor Relations
Representative to discuss the status of the City's budget and the salary adjustment that
was due to be implemented on December 19, 2009 for the NBFA members. At the
time, the NBFA was going to begin the 3`d year of a 3 year collective bargaining
agreement (January 1, 2008 through December 31, 2010.)
In recognition of the fiscal challenges facing the City, the NBFA expressed willingness
to meet and discuss ways to partially offset increased costs in CalPERS retirement, in
exchange for an extension in time to their Memorandum of Understanding (MOU) and
other trial operational considerations (48/96 work schedule).
Four additional meetings of good faith negotiations occurred through the months of
December 2009 and in January and February 2010. The City Council was kept
apprised of progress in Closed Session meetings in accordance with Brown Act Section
54957.6 that authorizes their conferring with the City's negotiators. The professional
tenor of the discussions between the City and the Association representatives was
appreciated by the City Council.
On February 23, 2010, the City and the NBFA reached a Tentative Agreement which
includes the following terms:
• Extend the Current MOU by 12 months to December 31, 2011;
• Implement the 3.5% wage increase previously negotiated, effective
December 19, 2009;
• Current safety unit employees (NBFA) to contribute 3.5% toward
retirement through a pre -tax payroll deduction, effective December 19,
2009;
• New safety hires to pay 5.5% of the 9% Employer Paid Member
Contribution for the first five years of employment (called a "Time -in -Grade
Exception "; required resolution included with agenda report);
• A trial period of the "48/96" work schedule to be implemented no later than
August 15, 2010, with terms being determined in a Side Letter Agreement.
Either the City or the Association may cancel the schedule at any time,
including during the initial 90 day trial;
• All other terms of the original MOU shall remain unchanged.
The membership of the NBFA ratified the above Tentative Agreement by a majority vote
of 94% in favor. The agreement does not become effective, per Government Code
Section 3505.1, until the governing body, i.e., City Council takes action to adopt it.
NBFA Supplemental MOU
April 13, 2010
Page 3
Pursuant to Government Code Section 20636(e) (1), and specifically authorized in Title
2, California Code of Regulations Section 569, the City Council may elect a Time -in-
Grade Exception for the City's Employer Paid Member Contribution (EPMC). The
Exception permits the City to provide varying levels of contributions toward EPMC for
newly hired employees, with a five year maximum. CalPERS has reviewed and
approved the attached resolution proposing the Time -in -Grade Exception.
If the Council approves these items, staff will strive to implement the MOU terms as
quickly as possible, and working with Interim Fire Chief Parker and Fire Department
staff, will define the terms of the Pilot "48/96" work schedule to ensure continued
excellent service to the community.
Public Notice:
Public notice was fulfilled with the posting of the agenda and report for this item.
Funding Availability:
The 3.5% increase, which includes increases to base pay, overtime, and special pays,
was originally estimated to cost approximately $243,600 for FY 2009 -10. The recovery
of 3.5% via pre -tax payroll deduction (to base pay only) was not contemplated when the
original cost estimates were prepared and will save the City approximately $157,460.
Alternatives:
The alternative would have been to implement the wage increase, without any
contribution by the employees and no extension of the Memorandum of Understanding.
In that case, the contract would expire on December 31, 2010.
Submitted by:
r 0
Da Kiff
City Manager
Terri L. Cassidy
Human Resources Director
Attachments: Resolution Adopting a Supplemental Memorandum of Understanding
(Attachment A)
Resolution Adopting EPMC Time -in -Grade Exception (Attachment B)
ATTACHMENT A
RESOLUTION NO. 2010 -
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH
ADOPTIONG A SUPPLEMENTAL MEMORANDUM OF
UNDERSTANDING BETWEEN THE CITY OF NEWPORT BEACH AND THE NEWPORT
BEACH FIREFIGHTERS ASSOCIATION
WHEREAS, the City Council of the City of Newport Beach previously adopted
Resolution No. 2001 -50, the "Employer- Employee Relations Resolution ", to promote
improved relations and communication between the City of Newport Beach and its
employees; and
WHEREAS, the City of Newport Beach previously entered into a Memorandum of
Understanding with the Newport Beach Firefighters Association for the period of January 1,
2008, through December 31, 2010; and
WHEREAS, representatives from the City of Newport Beach and the Newport Beach
Firefighters Association have met and conferred in good faith and agreed to modify the
current Memorandum of Understanding; and
WHEREAS, the City Council of the City of Newport Beach desires to modify the
Memorandum of Understanding between the City of Newport Beach and the Newport Beach
Firefighters Association by adopting the Supplemental Memorandum of Understanding:
NOW, THEREFORE, the City Council of the City of Newport Beach does RESOLVE
as follows:
Section 1. The term of the Supplemental Memorandum of Understanding shall be for
12 months, extending the current Memorandum of Understanding between the City of
Newport Beach and the Newport Beach Firefighters Association to December 31, 2011.
Section 2. Additional changes to wages and benefits shall be modified pursuant to
the provisions of the Supplemental Memorandum of Understanding (attached).
Section 3. All other terms of the current Memorandum of Understanding between the
City of Newport Beach and the Newport Beach Firefighters Association shall remain
unchanged.
Adopted this day of , 2010.
ATTEST:
City Clerk
Mayor of the City of Newport Beach
SUPPLEMENTAL MEMORANDUM OF UNDERSTANDING
BETWEEN
THE CITY OF NEWPORT BEACH
AND
THE NEWPORT BEACH FIREFIGHTERS ASSOCIATION
This Supplemental Memorandum of Understanding modifies the Memorandum of
Understanding between the City of Newport Beach and the Newport Beach Firefighters
Association for the period of January 1, 2008 to December 31, 2010. Upon the signing
of this Supplemental Memorandum, the 2008 -2010 MOU is modified to incorporate
these changes.
SECTION 1. GENERAL PROVISIONS
B. Duration of Memorandum —Amend to read:
1. Except as specifically provided otherwise, any ordinance, resolution
or action of the City Council necessary to implement this MOU shall
be considered effective as of January 1, 2008. This MOU shall
remain in full force and effect until December 31, 2011, and the
provisions of this MOU shall continue after the date of expiration of
this MOU in the event the parties are meeting and conferring on a
successor MOU.
The parties agree that, if NBFA submits preliminary requests for
changes in wages, fringe benefits and other terms and conditions of
employment earlier than 90 days prior to expiration of the MOU, the
parties will begin negotiations promptly, with the objective of
reaching an agreement by December 31, 2011.
SECTION 4. FRINGE BENEFITS
D. The Retirement Benefit — Amend to read:
1. Pursuant to Section 20691 of the California Government Code, the
City shall pay to PERS, on behalf of all safety employees covered
by this agreement and hired before April 13, 2010 the entire
required normal "safety member" retirement contribution, but not to
exceed 9% of the compensation earnable which PERS uses to
calculate retirement contributions and benefits. For safety
employees hired on or after April 13, 2010, the City will pay 3.5% of
the member contribution. Such employees will be eligible to
receive the 9% the beginning of their 6t" year of uninterrupted
service. For non - safety unit members the City shall pay the 7% of
the 8% normal miscellaneous member contribution. In addition, the
amount of this City payment of member contributions (EPMC) shall
be reported to PERS as special compensation, which is part of the
Page 1 of 3
employee's compensation earnable, pursuant to the provisions of
Section 20636 (c)(4) of the California Government Code, as
amended effective July 1, 1994. This payment shall be credited to
the employees' accounts maintained by PERS in accordance with
Section 20691 of the California Government Code. NBFA
acknowledges that the City is making this payment pursuant to a
specific request of NBFA to do so, that the City has made
significant financial commitments to NBFA in this MOU in
consideration of the members' agreement to relinquish their
previously held "irrevocable right" to pay their own PERS
contribution and receive a corresponding salary increase, and that
the significant financial concessions to NBFA (which included
Leave Premium Pay Accounts, changes in the calculation of "hours
worked" for purposes of overtime and internal salary adjustments)
were made to avoid the potential for increased overtime
compensation approximating $450,000 if all NBFA members
exercise their irrevocable right to make their own PERS contribution
and receive a corresponding salary increase.
2. The City's contract with PERS shall also provide for:
a. A 3% @ 50 retirement formula pursuant to the provisions of
Section 21252.01 of the California Government Code.
b. The military buy -back provisions pursuant to Section
20930.3 of the California Government Code and the highest
year benefit pursuant to Section 20042.
C. The Level 4 1959 Survivors Benefits.
d. Pre - retirement option settlement 2 death benefit pursuant to
Section 21548.
3. Pursuant to a separate agreement, non - safety unit members have
agreed to have 2.42% of the employer retirement cost added to the
employee's rate pursuant to California Retirement Code Section
20516. Non - safety employees now pay 3.42% (2.42% employer
and 1% employee) on a pre -tax basis pursuant to IRS Code
Section 414(h)(2).
4. Effective December 19, 2009, all safety unit employees will
contribute 3.5% of base pay towards retirement costs. This
payment will be made on a pre -tax basis through payroll deduction
pursuant to IRS Code Section 414(h)(2). This contribution will not
affect the reporting of the 9% EPMC for employees hired before
April 13, 2010 (Section 20636)(c)(4) of the California Government
Code.
Page 2 of 3
NEW SEC. TRIAL 48/96 SCHEDULE
Unless extended by mutual agreement, the Fire Department will
implement a trial 48/96 schedule no later than August 15, 2010. The
schedule will initially run for 90 days, subject to cancellation by the City or
Association at any time. It may be extended by mutual agreement. Prior
to the schedule implementation the City and Association will meet and
develop a side letter to govern the trial schedule.
Except as provided herein, the Memorandum of Understanding between the City and
the Newport Beach Firefighters Association remains in full force and effect.
Executed this day of , 2010:
NEWPORT BEACH FIREFIGHTERS ASSOCIATION:
By:
Chad Pon galek, President
By:
Brian �, V' -P�nt
By:
J Boyles, Represe ative At -Large
By:
Rich Thomas, Negotiation Team
CITY OF NEWPORT BEACH
MIN
ith D. Curry, Mayor
ATTEST:
Leilani Brown, City Clerk
APPROVED AS TO FORM:
Leonie Mulvihill, Acting City Attorney
Page 3 of 3
ATTACHMENT B
RESOLUTION NO. 2010 -
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH ADOPTING EMPLOYER PAID MEMBER
CONTRIBUTIONS TIME -IN -GRADE EXCEPTION
WHEREAS, the City Council of the City of Newport Beach has elected to pay all or
part of the normal member contributions to the California Public Employees' Retirement
System (CalPERS) pursuant to Government Code Section 20691, and applicable labor
policies and agreements; and
WHEREAS, the City Council of the City of Newport Beach may elect a Time -in -Grade
Exception to said Employer Paid Member Contributions (EPMC) within a given group or
class of employees as defined in Government Code Section 20636(e)(1) and as specifically
authorized in Title 2, California Code of Regulations Section 569; and
WHEREAS, the City Council of the City of Newport Beach desires to implement a
Time -in -Grade Exception.
NOW, THEREFORE, the City Council of the City of Newport Beach does RESOLVE
to implement a Time -in -Grade Exception as follows:
Section 1. The Time -in -Grade Exception shall apply to all safety employees of the
Newport Beach Firefighters Association (NBFA).
Section 2. The City of Newport Beach elects to continue to pay 9% of the Employer
Paid Member Contribution for all current safety employees.
Section 3. For employees in the Newport Beach Firefighters Association hired after
the date of adoption of this resolution, the City of Newport Beach shall pay 3.5% of the
Employer Paid Member Contribution.
Section 4. Beginning the sixth (6th) year of uninterrupted service employees will be
entitled to payment of EPMC on the same terms that apply to other safety employees in the
unit.
Adopted this day of 2010.
In
ATTEST:
City Clerk
Mayor of the City of Newport Beach
COQNCgL ACZAMA
f 7 4.13.10
SUPPLEMENTAL MEMORANDUM OF UNDERSTANDING
BETWEEN
THE CITY OF NEWPORT BEACH
AND
THE NEWPORT BEACH FIREFIGHTERS ASSOCIATION
This Supplemental Memorandum of Understanding modifies the Memorandum of
Understanding between the City of Newport Beach and the Newport Beach Firefighters
Association for the period of January 1, 2008 to December 31, 2010. Upon the signing
of this Supplemental Memorandum, the 2008 -2010 MOU is modified to incorporate
these changes.
SECTION 1. GENERAL PROVISIONS
B. Duration of Memorandum — Amend to read:
1. Except as specifically provided otherwise, any ordinance, resolution
or action of the City Council necessary to implement this MOU shall
be considered effective as of January 1, 2008. This MOU shall
remain in full force and effect until December 31, 2011, and the
provisions of this MOU shall continue after the date of expiration of
this MOU in the event the parties are meeting and conferring on a
successor MOU.
The parties agree that, if NBFA submits preliminary requests for
changes in wages, fringe benefits and other terms and conditions of
employment earlier than 90 days prior to expiration of the MOU, the
parties will begin negotiations promptly, with the objective of
reaching an agreement by December 31, 2011.
SECTION 4. FRINGE BENEFITS
D. The Retirement Benefit — Amend to read:
1. Pursuant to Section 20691 of the California Government Code, the
City shall pay to PERS, on behalf of all safety employees covered
by this agreement and hired before April 13, 2010 the entire
required normal "safety member" retirement contribution, but not to
exceed 9% of the compensation earnable which PERS uses to
calculate retirement contributions and benefits. For safety
employees hired on or after April 13, 2010, the City will pay 3:5% of
the member contribution. Such employees will be eligible to
receive the 9% the beginning of their 6th year of uninterrupted
service. For non - safety unit members the City shall pay the 7% of
the 8% normal miscellaneous member contribution. In addition, the
amount of this City payment of member contributions (EPMC) shall
be reported to PERS as special compensation, which is part of the
Page 1 of 3
employee's compensation earnable, pursuant to the provisions of
Section 20636 (c)(4) of the California Government Code, as
amended effective July 1, 1994. This payment shall be credited to
the employees' accounts maintained by PERS in accordance with
Section 20691 of the California Government Code. NBFA
acknowledges that the City is making this payment pursuant to a
specific request of NBFA to do so, that the City has made
significant financial commitments to NBFA in this MOU in
consideration of the members' agreement to relinquish their
previously held "irrevocable right" to pay their own PERS
contribution and receive a corresponding salary increase, and that
the significant financial concessions to NBFA (which included
Leave Premium Pay Accounts, changes in the calculation of "hours
worked" for purposes of overtime and internal salary adjustments)
were made to avoid the potential for increased overtime
compensation approximating $450,000 if all NBFA members
exercise their irrevocable right to make their own PERS contribution
and receive a corresponding salary increase.
2. The City's contract with PERS shall also provide for:
a. A 3% @ 50 retirement formula pursuant to the provisions of
Section 21252.01 of the California Government Code.
b. The military buy -back provisions pursuant to Section
20930.3 of the California Government Code and the highest
year benefit pursuant to Section 20042.
C. The Level 4 1959 Survivors Benefits.
d. Pre - retirement option settlement 2 death benefit pursuant to
Section 21548.
3. Pursuant to a separate agreement, non - safety unit members have
agreed to have 2.42% of the employer retirement cost added to the
employee's rate pursuant to California Retirement Code Section
20516. Non - safety employees now pay 3.42% (2.42% employer
and 1% employee) on a pre -tax basis pursuant to IRS Code
Section 414(h)(2).
4. Effective December 19, 2009, all safety unit employees will
contribute 3.5% of base pay towards retirement costs. This
payment will be made on a pre -tax basis through payroll deduction
pursuant to IRS Code Section 414(h)(2). This contribution will not
affect the reporting of the 9% EPMC for employees hired before
April 13, 2010 (Section 20636)(c)(4) of the California Government
Code.
Page 2 of 3
NEW SEC. TRIAL 48/96 SCHEDULE
Unless extended by mutual agreement, the Fire Department will
implement a trial 48/96 schedule no later than August 15, 2010. The
schedule will initially run for 90 days, subject to cancellation by the City or
Association at any time. It may be extended by mutual agreement. Prior
to the schedule implementation the City and Association will meet and
develop a side letter to govern the trial schedule.
Except as provided herein, the Memorandum of Understanding between the City and
the Newport Beach Firefighters Association remains in full force and effect.
Executed this day of , 2010:
NEWPORT BEACH FIREFIGHTERS ASSOCIATION:
M
Chad Pon
By: `6
Brian McL
By:
JM Boyles, Re
0
CITY OF NEWPORT BEACH
Keith D. Curry, Mayor
ATTEST:
Leilani Brown, City Clerk
,A OVE AS TO F�I V
—
Leonie Mulvihill, Acting City Attorney
President
At -Large
Rich Thomas, Negotiation Team
Page 3 of 3